To Seek Bad Faith Tort Damages There Must be Injury in Excess of Policy Benefits
Post 5205
Read the full article at https://www.linkedin.com/pulse/payment-appraisal-award-precludes-bad-faith-claim-zalma-esq-cfe-rkzrc and at https://zalma.com/blog plus more than 5200 posts.
In Keith Frederich v. Trisura Specialty Insurance Company, No. 24-40748, United States Court of Appeals, Fifth Circuit (October 7, 2025) explained that an insured cannot maintain tort claims against an insurer if the insured has received the full appraisal award, absent evidence of an independent injury.
FACTS
Keith Frederich sued his insurer, Trisura Specialty Insurance Company ("Trisura" ), for allegedly violating the Texas Insurance Code. He appealed the grant of summary judgment in favor of Trisura.
Trisura moved for summary judgment, arguing that its payment of the appraisal award plus interest foreclosed Frederich's claims. Frederich countered that Chapter 541 allows an insured to recover tort damages that are cumulative to, and distinct from, any breach-of-contract damages. The district court granted summary judgment in favor of Trisura, concluding that Frederich had received all benefits to which he was entitled through the appraisal process and had failed to establish an independent injury.
ANALYSIS
On appeal, Frederich contended that Chapter 541 allows an insured to recover tort damages that are independent and distinct from contractual damages for breach of contract.
Trisura argued that its payment of the appraisal award plus statutory interest foreclosed all of Frederich's claims under Chapter 541. The Fifth Circuit affirmed the district court's judgment, holding that an insured cannot bring tort claims against an insurer under Chapter 541 after receiving an appraisal award and applicable statutory interest, absent an independent injury.
The Fifth Circuit explained that an insured cannot maintain tort claims against an insurer if the insured has received the full appraisal award, absent evidence of an independent injury.
Frederich's argument failed under the Fifth Circuit’s decision in Mirelez v. State Farm Lloyds, 127 F.4th 949 (5th Cir. 2025). Like Frederich, Mirelez asserted he could recover tort damages even when an appraisal award, any applicable interest, and any payments due under the insurance policy were paid out.
Because Mirelez sought no actual damages other than the policy benefits paid in accordance with the policy's appraisal provision, he could not maintain a bad faith claim under either the common law or chapter 541.
Mirelez foreclosed the insured's appeal because even if the plaintiff in Mirelez had raised the same statutory-construction argument, the panel would have rejected it as foreclosed by the Texas Supreme Court's interpretation of Chapter 541.
In sum, Mirelez foreclosed Frederich's appeal. Absent an independent injury, an insured cannot bring tort claims against an insurer under Chapter 541 after receiving an appraisal award and applicable statutory interest.
ZALMA OPINION
Bad faith suits in Texas require, among other things, damages other than a common law breach of contract. When, as here, Frederich's claims were paid in full after appraisal. As a result he incurred no damages in excess of the claim amount which was paid in full plus interest.
(c) 2025 Barry Zalma & ClaimSchool, Inc.
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Formulaic Recitation Of The Elements Of Civil Conspiracy Are Insufficient
Post number 5320
See the full video at https://lnkd.in/gPACkgWq and at https://lnkd.in/gsaxij7D, and at https://zalma.com/blog plus more than 5300 posts.
In Hassan Fayad v. Liberty Mutual Insurance Company, et al., No. 2:25-cv-10930, United States District Court, E.D. Michigan, Southern Division (March 24, 2026) Plaintiff Hassan Fayad, the owner of several businesses providing transportation, diagnostics, testing, and therapy services, regularly billed insurance companies for these services, was arrested and tried for fraud, convicted, had the conviction overruled and sued the insurers and prosecutors he found responsible.
FACTUAL BACKGROUND
By January 2020, Liberty Mutual, Progressive, Allstate, and Esurance suspected fraudulent activity and filed a complaint with the Michigan Department of Attorney General (MDAG). The insurers alleged that Fayad and others billed Michigan auto insurance policies for profit without actually providing medically ...
Federal Courts Have Limited Jurisdiction
When all Parties Refuse Removal There is No Jurisdiction
Post number 5319
Read the full article at https://lnkd.in/gp6Z-JYY, see the full video at https://lnkd.in/gAum322y and at https://lnkd.in/gRPzCjmt and at https://zalma.com/blog plus more than 5300 posts.
In Beth Mayhew and Matthew Mayhew v. Vladimir Sadovyh, et al., No. 2:26-CV-04029-WJE, United States District Court, W.D. Missouri (April 6, 2026) Mayhew was involved in a trailer-truck accident with Vladimir Sadovyh, who was employed by Nova First, LLC and Globex Transport, Inc. Both companies owned the tractor-trailer involved.
FACTUAL BACKGROUND
Chubb and Mohave Transportation Insurance Company jointly issued an insurance policy covering Nova First, Globex, and Sadovyh, with EMA Risk Services acting as a third-party administrator.
Beth Mayhew sued Nova First, Globex, and Sadovyh for negligence in Missouri state court, and following a jury trial, a nuclear judgment was awarded to the Mayhews totaling ...
Ordinary Negligence is What Medical Professi0nal Liability Insures
Post number 5319
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Sexual Conduct Exclusion Doesn’t Apply When Doctor Negligently Uses His Own Sperm
In Integris Insurance Company v. Narendra B. Tohan, No. AC 47222, Court of Appeals of Connecticut (April 7, 2026) Integris Insurance Company, a medical professional liability insurer, initiated a declaratory action to determine its duty to defend and indemnify Narendra B. Tohan, a physician licensed in Connecticut, in a separate negligence action alleging medical misconduct.
FACTUAL BACKGROUND
In 2019, Kayla Suprynowicz and Reilly Flaherty (civil action plaintiffs), who were strangers for most of their lives, discovered through a genetic testing company that they are half siblings.
INSURANCE POLICY
The policy defines “Professional Services” in relevant part as “any professional medical services within the ...
ZIFL – Volume 30, Issue 7 – April 1, 2026
THE SOURCE FOR THE INSURANCE FRAUD PROFESSIONAL
Post number 5314
Posted on April 1, 2026 by Barry Zalma
Zalma’s Insurance Fraud Letter (ZIFL) continues its 30th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at http://zalma.com/zalmas-insurance-fraud-letter-2/ This issue contains the following articles about insurance fraud:
No One is Above the Law – Not Even a Police Officer
Police Officer Convicted for Fraud in Reporting an Accident Affirmed
Police Officer Should never Lie about Results of Chase
In State Of Ohio v. Anthony Holmes, No. 115123, 2026-Ohio-736, Court of Appeals of Ohio, Eighth District, Cuyahoga (March 5, 2026) a police officer appealed criminal conviction as a result of lies about a high speed chase.
Read the following article and the full issue of ZIFL at https://zalma.com/blog/wp-content/uploads/2026/03/ZIFL-04-01-2026-1.pdf...
ZIFL – Volume 30, Issue 7 – April 1, 2026
THE SOURCE FOR THE INSURANCE FRAUD PROFESSIONAL
Post number 5314
Posted on April 1, 2026 by Barry Zalma
Zalma’s Insurance Fraud Letter (ZIFL) continues its 30th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at http://zalma.com/zalmas-insurance-fraud-letter-2/ This issue contains the following articles about insurance fraud:
No One is Above the Law – Not Even a Police Officer
Police Officer Convicted for Fraud in Reporting an Accident Affirmed
Police Officer Should never Lie about Results of Chase
In State Of Ohio v. Anthony Holmes, No. 115123, 2026-Ohio-736, Court of Appeals of Ohio, Eighth District, Cuyahoga (March 5, 2026) a police officer appealed criminal conviction as a result of lies about a high speed chase.
Read the following article and the full issue of ZIFL at https://zalma.com/blog/wp-content/uploads/2026/03/ZIFL-04-01-2026-1.pdf...
Posted on March 30, 2026 by Barry Zalma
Insurance Fraud, a Way to Reduce Violent Crime
Post number 5313
A Fictionalized True Crime Story of Insurance Fraud from an Expert who explains why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story helps to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the Perpetrators than any Other Crime.
She Taught Her Customers The Swoop And Squat:
Recently the California Insurance Department’s Fraud Division arrested a young woman in Los Angeles County for operating an insurance fraud school. She advertised her classes in the “Penny Saver” an advertising sheet distributed free to the public and a print version of Facebook, X Craig’s list. She had operated for several years teaching methods of committing automobile insurance fraud. Only after a police officer enrolled in one of her classes was she arrested.
Her defense ...
